APRIL 30, 2020
First Guaranty Bancshares, Inc. Announces First Quarter 2020 Results

Hammond, Louisiana, April 30, 2020 – First Guaranty Bancshares, Inc. ("First Guaranty") (NASDAQ: FGBI), the holding company for First Guaranty Bank, announced its unaudited financial results for the quarter ending March 31, 2020.
2020 got off to a great start as the momentum of 2019 carried over and built. In 2019, we developed a strategy to significantly reduce our cost of funds following the basic tenet that lower cost results in greater profit on the same income. Our strong start to 2020 included both more income and lower cost therefore, more profit. Loan interest income for the first quarter of 2020 increased 21.5% over loan interest income for the first quarter of 2019 as total loans increased from $1,298,156,000 as of March 31, 2019 to $1,544,132,000 as of March 31, 2020. This was an increase of 18.9% year over year. As noted above, in spite of falling interest rates, the loan interest income increased by 21.5%.

On the other hand, in the first quarter of 2020 interest expense totaled $7,514,000 as opposed to $7,382,000 for the same period of 2019. This was an increase of only 1.8%. As a result of the dramatic improvement in the income/expense ratio, we were able to increase our net interest income after provision for loan losses from $13,806,000 as of March 31, 2019 to $16,679,000 as of March 31, 2020, an increase of 20.8%. This increase of 20.8% was in spite of an increase in our provision for loan loss from $787,000 as of March 31, 2019 to $1,245,000 as of March 31, 2020.

In addition to the significant improvement on the interest income side, our non-interest income as of March 31, 2020 totaled $2,425,000 compared to $1,301,000 as of March 21, 2019, an increase of 86.4%.

The bottom line is that earnings for each share on your stock for the first quarter of the year increased from $0.32 per share for 2019 to $0.39 per share for 2020, an increase of 21.9%. The book value of each of your shares increased from $15.96 as of March 31, 2019 to $17.35 as of March 31, 2020, an increase of $1.39 per share. On March 31, 2020, a dividend of $0.16 per share was paid for each share of your stock, with that cash dividend being the 107th consecutive quarterly dividend paid by First Guaranty Bancshares, Inc. We have made substantial progress towards our goals of building a fortress balance sheet and enhancing shareholder value.

The invasion of the Coronavirus has presented us with new hurdles to overcome; however, we have moved quickly and decisively to assist our customers and employees to provide loan deferments and low cost relief loans to minimize the harm. We have also moved quickly to enroll as many of our customers as possible in the Payroll Protection Plan (PPP) that has been instituted by the Treasury Department and the SBA. We have also moved to ensure that First Guaranty Bank has available the liquidity and the resources needed to handle the situation. We do not intend to allow this crisis to interfere with our progress at First Guaranty Bancshares, Inc.

If you have any questions, please do not hesitate to contact me at (985)375-0350.

Alton B. Lewis
President and CEO
First Guaranty, Bancshares, Inc.
About First Guaranty
First Guaranty, a Louisiana-based company, has approximately $2.3 billion in assets as of March 31, 2020 and provides personalized commercial banking services through 33 banking facilities located across Louisiana and Texas. For more information, visit www.fgb.net.
Certain statements contained herein are "forward looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward looking statements may be identified by reference to a future period or periods, or by the use of forward looking terminology, such as "may," "will," "believe," "expect," "estimate," "anticipate," "continue," or similar terms or variations on those terms, or the negative of those terms. Forward looking statements are subject to numerous risks and uncertainties, as described in our SEC filings, including, but not limited to, those related to the real estate and economic environment, particularly in the market areas in which First Guaranty operates, competitive products and pricing, fiscal and monetary policies of the U.S. Government, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, acquisitions and the integration of acquired businesses, credit risk management, asset-liability management, the financial and securities markets and the availability of and costs associated with sources of liquidity.
First Guaranty wishes to caution readers not to place undue reliance on any such forward looking statements, which speak only as of the date made. First Guaranty wishes to advise readers that the factors listed above could affect First Guaranty's financial performance and could cause First Guaranty's actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements. First Guaranty does not undertake and specifically declines any obligation to publicly release the results of any revisions, which may be made to any forward looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

(in thousands, except share data)March 31, 2020December 31, 2019
Cash and cash equivalents:  
Cash and due from banks$168,962  $66,511  
Federal funds sold493  914  
Cash and cash equivalents169,455  67,425  
Investment securities:  
Available for sale, at fair value433,926  339,937  
Held to maturity, at cost (estimated fair value of $0 and $86,817 respectively)—  86,579  
Investment securities433,926  426,516  
Federal Home Loan Bank stock, at cost3,324  3,308  
Loans held for sale476  —  
Loans, net of unearned income1,544,132  1,525,490  
Less: allowance for loan losses11,961  10,929  
Net loans1,532,171  1,514,561  
Premises and equipment, net58,081  56,464  
Goodwill13,217  12,942  
Intangible assets, net6,958  7,166  
Other real estate, net4,385  4,879  
Accrued interest receivable10,076  8,412  
Other assets19,082  15,543  
Total Assets$2,251,151  $2,117,216  
Liabilities and Shareholders' Equity  
Noninterest-bearing demand$321,158  $325,888  
Interest-bearing demand714,705  635,942  
Savings145,390  135,156  
Time767,352  756,027  
Total deposits1,948,605  1,853,013  
Short-term advances from Federal Home Loan Bank50,000  13,079  
Repurchase agreements6,603  6,840  
Accrued interest payable5,940  6,047  
Long-term advances from Federal Home Loan Bank3,489  3,533  
Senior long-term debt47,014  48,558  
Junior subordinated debentures14,747  14,737  
Other liabilities5,726  5,374  
Total Liabilities2,082,124  1,951,181  
Shareholders' Equity  
Common stock:  
$1 par value - authorized 100,600,000 shares; issued 9,741,253 shares9,741  9,741  
Surplus110,836  110,836  
Retained earnings45,549  43,283  
Accumulated other comprehensive income2,901  2,175  
Total Shareholders' Equity169,027  166,035  
Total Liabilities and Shareholders' Equity$2,251,151  $2,117,216  
See Notes to Consolidated Financial Statements  

 Three Months Ended
March 31,
(in thousands, except share data)20202019
Interest Income:  
Loans (including fees)$22,460  $18,482  
Deposits with other banks235  636  
Securities (including FHLB stock)2,743  2,857  
Federal funds sold—  —  
Total Interest Income25,438  21,975  
Interest Expense:  
Demand deposits2,110  2,811  
Savings deposits116  138  
Time deposits4,560  4,007  
Borrowings728  426  
Total Interest Expense7,514  7,382  
Net Interest Income17,924  14,593  
Less: Provision for loan losses1,245  787  
Net Interest Income after Provision for Loan Losses16,679  13,806  
Noninterest Income:  
Service charges, commissions and fees729  608  
ATM and debit card fees609  528  
Net gains (losses) on securities500  (402) 
Net gains on sale of loans16  11  
Other571  556  
Total Noninterest Income2,425  1,301  
Noninterest Expense:  
Salaries and employee benefits7,399  5,962  
Occupancy and equipment expense1,829  1,485  
Other5,067  3,721  
Total Noninterest Expense14,295  11,168  
Income Before Income Taxes4,809  3,939  
Less: Provision for income taxes984  807  
Net Income$3,825  $3,132  
Per Common Share:1
Earnings$0.39  $0.32  
Cash dividends paid $0.16  $0.15  
Weighted Average Common Shares Outstanding9,741,253  9,687,123  
 See Notes to Consolidated Financial Statements                    
1 All share and per share amounts have been restated to reflect the ten percent stock dividend paid December 16, 2019 to shareholders of record as of December 9, 2019.

 Three Months Ended March 31, 2020Three Months Ended March 31, 2019
(in thousands except for %)Average BalanceInterestYield/Rate (5)Average BalanceInterestYield/Rate (5)
Interest-earning assets:      
Interest-earning deposits with banks$92,806  $235  1.02 %$117,438  $636  2.20 %
Securities (including FHLB stock)413,718  2,743  2.67 %402,908  2,857  2.88 %
Federal funds sold571  —  — %516  —  — %
Loans held for sale 223   5.69 %417   7.78 %
Loans, net of unearned income1,514,573  22,457  5.96 %1,276,328  18,474  5.87 %
Total interest-earning assets2,021,891  $25,438  5.06 %1,797,607  $21,975  4.96 %
Noninterest-earning assets:      
Cash and due from banks12,382  9,115    
Premises and equipment, net57,142  40,937    
Other assets34,010  12,318    
Total Assets$2,125,425    $1,859,977    
Liabilities and Shareholders' Equity      
Interest-bearing liabilities:      
Demand deposits$647,432  $2,110  1.31 %$604,247  $2,811  1.89 %
Savings deposits145,024  116  0.32 %110,130  138  0.51 %
Time deposits758,807  4,560  2.42 %706,824  4,007  2.30 %
Borrowings80,046  728  3.66 %34,510  426  5.00 %
Total interest-bearing liabilities1,631,309  $7,514  1.85 %1,455,711  $7,382  2.06 %
Noninterest-bearing liabilities:      
Demand deposits312,160  246,895    
Other11,058  6,771    
Total Liabilities1,954,527    1,709,377    
Shareholders' equity170,898  150,600    
Total Liabilities and Shareholders' Equity$2,125,425    $1,859,977    
Net interest income $17,924    $14,593   
Net interest rate spread (1)  3.21 %  2.90 %
Net interest-earning assets (2)$390,582    $341,896    
Net interest margin (3), (4)  3.57 %3.29 %
Average interest-earning assets to interest-bearing liabilities  123.94 %123.49 %
(1)Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(2)Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.
(3)Net interest margin represents net interest income divided by average total interest-earning assets.
(4)The tax adjusted net interest margin was 3.57% and 3.30% for the above periods ended March 31, 2020 and 2019 respectively. A 21% tax rate was used to calculate the effect on securities income from tax exempt securities for the above periods ended March 31, 2020 and 2019 respectively.

The following table summarizes the components of First Guaranty's loan portfolio as of March 31, 2020, December 31, 2019, September 30, 2019 and June 30, 2019:
 March 31, 2020December 31, 2019September 30, 2019June 30, 2019
(in thousands except for %)BalanceAs % of CategoryBalanceAs % of CategoryBalanceAs % of CategoryBalanceAs % of Category
Real Estate:    
Construction & land development$125,230  8.1 %$172,247  11.3 %$157,980  12.2 %$148,156  11.4 %
Farmland21,840  1.4 %22,741  1.5 %16,484  1.3 %17,414  1.3 %
1- 4 Family285,751  18.5 %289,635  18.9 %187,772  14.5 %185,234  14.2 %
Multifamily28,294  1.8 %23,973  1.6 %22,459  1.7 %44,104  3.4 %
Non-farm non-residential654,111  42.3 %616,536  40.3 %585,177  45.1 %604,523  46.4 %
Total Real Estate1,115,226  72.1 %1,125,132  73.6 %969,872  74.8 %999,431  76.7 %
Non-Real Estate:
Agricultural25,320  1.6 %26,710  1.8 %29,193  2.3 %26,587  2.0 %
Commercial and industrial298,185  19.3 %268,256  17.5 %213,993  16.5 %199,768  15.3 %
Consumer and other108,923  7.0 %108,868  7.1 %83,029  6.4 %78,321  6.0 %
Total Non-Real Estate432,428  27.9 %403,834  26.4 %326,215  25.2 %304,676  23.3 %
Total loans before unearned income1,547,654  100.0 %1,528,966  100.0 %1,296,087  100.0 %1,304,107  100.0 %
Unearned income(3,522)  (3,476) (3,176) (3,554) 
Total loans net of unearned income$1,544,132   $1,525,490  $1,292,911  $1,300,553  

The table below sets forth the amounts and categories of our nonperforming assets at the dates indicated.
(in thousands)March 31, 2020December 31, 2019September 30, 2019June 30, 2019
Nonaccrual loans:  
Real Estate:  
Construction and land development$901  $381  $390  $402  
Farmland855  1,274  1,337  1,337  
1- 4 family4,347  2,759  1,975  1,678  
Multifamily—  —  —  —  
Non-farm non-residential4,638  4,646  745  609  
Total Real Estate10,741  9,060  4,447  4,026  
Non-Real Estate:    
Agricultural4,480  4,800  4,842  4,923  
Commercial and industrial412  327  454  362  
Consumer and other273  216  1,155  37  
Total Non-Real Estate5,165  5,343  6,451  5,322  
Total nonaccrual loans15,906  14,403  10,898  9,348  
Loans 90 days and greater delinquent & accruing:    
Real Estate:    
Construction and land development414  48  —  —  
Farmland—  —  —  —  
1- 4 family1,203  923   60  
Multifamily—  —  —  —  
Non-farm non-residential5,056  1,603  184  468  
Total Real Estate6,673  2,574  186  528  
Non-Real Estate:    
Agricultural46  —  —  242  
Commercial and industrial139  15  24  127  
Consumer and other58  50  128  19  
Total Non-Real Estate243  65  152  388  
Total loans 90 days and greater delinquent & accruing6,916  2,639  338  916  
Total non-performing loans22,822  17,042  11,236  10,264  
Real Estate Owned:    
Real Estate Loans:    
Construction and land development669  669  213  219  
Farmland—  —  —  —  
1- 4 family205  559  117  466  
Multifamily—  —  —  —  
Non-farm non-residential3,511  3,651  3,040  3,049  
Total Real Estate4,385  4,879  3,370  3,734  
Non-Real Estate Loans:    
Agricultural—  —  —  —  
Commercial and industrial—  —  —  —  
Consumer and other—  —  —  —  
Total Non-Real Estate—  —  —  —  
Total Real Estate Owned4,385  4,879  3,370  3,734  
Total non-performing assets$27,207  $21,921  $14,606  $13,998  
Non-performing assets to total loans1.76 %1.44 %1.13 %1.08 %
Non-performing assets to total assets1.21 %1.04 %0.81 %0.75 %
Non-performing loans to total loans1.48 %1.12 %0.87 %0.79 %

Non-GAAP Financial Measures
Our accounting and reporting policies conform to accounting principles generally accepted in the United States, or GAAP, and the prevailing practices in the banking industry. However, we also evaluate our performance based on certain additional metrics. Tangible book value per share and the ratio of tangible equity to tangible assets are not financial measures recognized under GAAP and, therefore, are considered non-GAAP financial measures.
Our management, banking regulators, many financial analysts and other investors use these non-GAAP financial measures to compare the capital adequacy of banking organizations with significant amounts of preferred equity and/or goodwill or other intangible assets, which typically stem from the use of the purchase accounting method of accounting for mergers and acquisitions. Tangible equity, tangible assets, tangible book value per share or related measures should not be considered in isolation or as a substitute for total shareholders' equity, total assets, book value per share or any other measure calculated in accordance with GAAP. Moreover, the manner in which we calculate tangible equity, tangible assets, tangible book value per share and any other related measures may differ from that of other companies reporting measures with similar names.
The following table reconciles, as of the dates set forth below, shareholders' equity (on a GAAP basis) to tangible equity and total assets (on a GAAP basis) to tangible assets and calculates our tangible book value per share.
 At March 31,At December 31,
(in thousands except for share data and %)20202019201820172016
Tangible Common Equity  
Total shareholders' equity$169,028  $166,035  $147,284  $143,983  $124,349  
Goodwill13,217  12,942  3,472  3,472  1,999  
Acquisition intangibles6,349  6,527  2,704  3,249  978  
Tangible common equity$149,462  $146,566  $141,108  $137,262  $121,372  
Common shares outstanding1
9,741,253  9,741,253  9,687,123  9,687,123  9,205,635  
Book value per common share1
$17.35  $17.04  $15.20  $14.86  $13.51  
Tangible book value per common share1
$15.34  $15.05  $14.57  $14.17  $13.18  
Tangible Assets
Total Assets$2,251,151  $2,117,216  $1,817,211  $1,750,430  $1,500,946  
Goodwill13,217  12,942  3,472  3,472  1,999  
Acquisition intangibles6,349  6,527  2,704  3,249  978  
Tangible Assets$2,231,585  $2,097,747  $1,811,035  $1,743,709  $1,497,969  
Tangible common equity to tangible assets6.70 %6.99 %7.79 %7.87 %8.10 %
1 All share amounts have been restated to reflect the ten percent stock dividend paid December 16, 2019 to shareholders of record as of December 9, 2019.

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